Eleventh Circuit Rejects Reliance Standard’s Broad Interpretation of Preexisting Condition Exclusion

In Johnson v. Reliance Standard Life Insurance Company, No. 23-13443, —F.4th—-, 2025 WL 3251015 (11th Cir. Nov. 21, 2025), a significant decision limiting insurers’ ability to deny early-term disability claims based on preexisting condition exclusions, the Eleventh Circuit reversed Reliance Standard’s denial of benefits to a claimant later diagnosed with scleroderma. The court held that the insurer’s interpretation of its preexisting condition clause—which deemed any treatment for any symptom consistent with a later-diagnosed disease as “treatment for” that disease—was both wrong and unreasonable, even under the deferential arbitrary-and-capricious standard.

Background

Cheriese Johnson began experiencing various symptoms—fatigue, swelling, gastrointestinal issues, and pain—months before her long-term disability coverage became effective. During the three-month lookback period preceding coverage, she repeatedly sought treatment, receiving a range of unrelated diagnoses including fibromyalgia, GERD, hypertension, somatoform disorder, and borderline lupus. None of her providers suspected or treated her for scleroderma, the rare autoimmune condition she was ultimately diagnosed with four months after the lookback period ended.

Johnson became unable to work in January 2017 and filed a disability claim based on scleroderma. Reliance Standard denied the claim, asserting that because she received medical care during the lookback period for symptoms that were “not inconsistent with” scleroderma, the disease constituted a preexisting condition under the policy.

The Policy Language at Issue

The long-term disability plan excluded benefits for a disability “caused by, contributed to by, or resulting from” a Pre-Existing Condition, defined as a sickness “for which the Insured received medical treatment, consultation, care or services (including diagnostic procedures), or took prescribed drugs” during the lookback period. The dispute turned on the meaning of the phrase “for which.”

Eleventh Circuit’s Analysis

1. Step One – Reliance’s Interpretation Was De Novo Wrong

Applying ERISA common-law contract principles, the court held that “for” connotes purpose or intent. Because neither Johnson nor her doctors suspected scleroderma—or treated her with the aim of addressing scleroderma—she could not have received treatment “for” that condition during the lookback period.

The court emphasized:

• A doctor cannot treat a disease she does not know exists.
• Vague or general symptoms, even if later understood to relate to a diagnosis, are not the same as treatment “for” the disease.
• Reliance’s reading improperly collapsed the distinction between treatment of a symptom and treatment of the underlying illness.

2. Step Two – Reliance Had Discretion Under the Plan

The policy clearly vested Reliance Standard with discretion to interpret the plan and determine benefits, moving the court to step three of the Blankenship test.

3. Step Three – Reliance’s Decision Was Unreasonable (Arbitrary and Capricious)

Even under a deferential standard, Reliance’s interpretation was unreasonable because it rendered the term “preexisting condition” meaningless. Under its logic, any symptom—no matter how general—could bar coverage for any later-diagnosed disease if the symptom was theoretically consistent with the disease after the fact.

The court provided vivid examples:

• Treating dehydration-induced headaches would be considered treatment “for” a future-diagnosed brain tumor.
• Treating a cough during the lookback period could be deemed treatment “for” tuberculosis discovered months later.

Such an expansive, retrospective interpretation “warps the plain and ordinary meaning” of the contractual terms and transforms a preexisting condition exclusion into a preexisting symptom exclusion.

4. Distinguishing Reliance’s Cited Cases

The court was unpersuaded by Reliance’s reliance on Ferrizzi v. Reliance Standard Life Insurance Company, 792 F. App’x 678, 680 (11th Cir. Nov. 7, 2019), noting:

• It is unpublished and nonprecedential.
• In Ferrizzi, the patient’s substance dependency was in fact suspected and treated during the lookback period—unlike here.

The court also distinguished the Seventh Circuit’s decision in Bullwinkel v. New England Mut. Life Ins. Co., 18 F.3d 429, 430–32 (7th Cir. 1994), where doctors specifically suspected cancer at the time of pre-policy testing.

Holding

The Eleventh Circuit held that:

• Reliance’s interpretation of “for which” was de novo wrong,
• Reliance had interpretive discretion, but
• Its reading was unreasonable, even under arbitrary-and-capricious review.

The court reversed summary judgment for Reliance Standard and remanded for further proceedings consistent with its opinion. Chief Judge William Pryor authored a dissent, stating that he would have affirmed the decision. He reasoned that treatment of symptoms attributable to scleroderma was sufficient to render the disease preexisting, even if undiagnosed.